Exhibit 99.1
July 26, 2000
Contact: John R. Biggar, PPL Corp. (610) 774-5613
Timothy J. Paukovits, PPL Corp. (610) 774-4124
PPL'S EARNINGS SHATTER RECORD,
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SPARK INCREASED EARNINGS FORECASTS FOR 2000 AND 2001
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ALLENTOWN, Pa.-- Fueled by the highest level of earnings in the
company's history, PPL Corp. (NYSE: PPL) today (7/26) increased its earnings
forecasts for 2000 and 2001.
PPL Corp. reported record second quarter earnings of $0.64 per share
in 2000. This figure is a 60 percent increase over the $0.40 per share reported
in the second quarter of 1999.
For the first half of 2000, the company reported earnings of $1.63 per
share, an increase of more than 40 percent over the $1.16 per share reported in
the first half of 1999, which was the previous highest earnings level in PPL's
history for the first six months of the year.
"This unprecedented earnings performance was made possible by a set of
business fundamentals that we believe will continue. Using conservative
assumptions about future business conditions, we are increasing our earnings
forecast to between $2.80 and $2.90 per share for 2000 and to between $3.10 and
$3.20 per share for 2001," said William F. Hecht, PPL Corp.'s chairman,
president and chief executive officer. The company previously had forecasted
earnings of $2.65 per share for 2000 and $3.00 per share for 2001.
"We are seeing improved performance on already strong earnings growth
across all of our business lines," said Hecht. "Of particular importance is our
ability to extract increasing value from our portfolio of about 10,000 megawatts
of merchant generation by combining our skills as operators of low-cost power
plants with the ability of our disciplined energy marketers and traders to
capture value afforded by competitive energy markets."
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Hecht said PPL's corporate strategy of generating and marketing
competitively priced energy in key U.S. markets and owning and operating
high-quality energy delivery businesses in selected regions around the world has
led to record-breaking, sustainable growth.
To maximize opportunities in key U.S. energy markets, PPL has plans to
increase its generating capacity to about 20,000 megawatts by the middle of this
decade. The company now owns and operates about 10,000 megawatts of capacity in
Pennsylvania, Montana and Maine and is developing an additional 2,700 megawatts
in Connecticut, New York, Pennsylvania and Arizona.
The major drivers of PPL's stronger than previously forecast earnings
performance for 2000 are:
o increased margins on energy transactions, including increased sales of
retail and wholesale energy in deregulated markets and increased volumes of
electricity supplied in regulated markets;
o higher volumes of electricity delivered in PPL Utilities' franchised
service territory;
o success in continuing to reduce operating costs; and
o higher earnings from the company's PPL Montana business.
The above factors are expected to continue to drive earnings
improvement in 2001.
PPL experienced strong growth in operating revenues and net income
during the first half of 2000 as compared to the first half of 1999, with
operating revenues increasing 31 percent and net income increasing 28 percent.
Similar strong growth took place in the second quarter of 2000, as operating
revenues increased 29 percent and net income increased 46 percent in comparison
to the second quarter of 1999.
Excluding one-time items, earnings per share for the 12 months ended
June 30, 2000, were $2.80 compared to the similarly adjusted earnings per share
of $2.12 reported for the same period last year, an increase of 32 percent. Net
income for the 12 months ended June 30, 2000, increased by 19 percent over the
same period last year. Operating revenues for the 12 months ended June 30, 2000,
were up 26 percent over the same period last year.
Based in Allentown, Pa., PPL Corp. is a FORTUNE 500(R) company that
delivers electricity and natural gas to more than 1.3 million customers in
Pennsylvania; markets wholesale or retail energy in 43 U.S. states and Canada;
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provides energy services for businesses in the Mid-Atlantic and Northeastern
U.S.; generates electricity at power plants in Pennsylvania, Maine and Montana;
delivers electricity to 1.4 million customers in southwest Britain; and delivers
electricity to nearly 1.8 million customers in Chile, Bolivia, El Salvador and
Brazil.
PPL CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED)
----------------------------------------------
CONSOLIDATED BALANCE SHEET
(MILLIONS OF DOLLARS)
JUNE 30, 2000 DEC. 31, 1999
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ASSETS
------
Investments and current assets $ 2,476 $1,988
Property, plant and equipment
Transmission and distribution - net 2,470 2,462
Generation - net 2,465 2,352
General and intangible - net 277 259
Construction work in progress 221 181
Nuclear fuel and other leased property 123 139
--------- ---------
Electric utility plant - net 5,556 5,393
Gas and oil utility plant - net 171 171
Other property - net 69 60
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5,796 5,624
Recoverable transition costs 2,538 2,647
Regulatory and other assets 1,059 915
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Total assets $11,869 $11,174
========= =========
LIABILITIES AND EQUITY
Current liabilities $2,273 $2,280
Long-term debt (less current portion) 4,329 3,689
Deferred income taxes and ITC 1,529 1,548
Liability for above market NUG purchases 627 674
Other noncurrent liabilities 933 959
Minority interest 55 64
Company-obligated mandatorily redeemable securities 250 250
Preferred stock 97 97
Earnings reinvested 812 654
Other common equity 1,800 1,795
Treasury stock (836) (836)
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Total liabilities and equity $11,869 $11,174
========= =========
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CONSOLIDATED INCOME STATEMENT
(MILLIONS OF DOLLARS)
<TABLE>
<CAPTION>
3 MONTHS ENDED JUNE 30 6 MONTHS ENDED JUNE 30 12 MONTHS ENDED JUNE 30
---------------------- ---------------------- -----------------------
2000 1999(A) 2000 1999(A) 2000 1999(A)
--------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
OPERATING REVENUES
Electric $ 683 $ 584 $ 1,472 $ 1,251 $ 2,979 $ 2,486
Natural Gas and propane 36 24 94 70 140 105
Wholesale energy marketing and trading 483 336 943 632 $ 1,750 $ 1,351
Energy-related businesses 95 60 201 118 360 196
--------- --------- --------- --------- --------- ---------
1,297 1,004 2,710 2,071 5,229 4,138
--------- --------- --------- --------- --------- ---------
OPERATING EXPENSES
Fuel and purchased power 593 454 1,201 866 2,366 1,778
Other operation and maintenance 215 197 424 392 912 812
Amortization of recoverable transition costs 46 41 109 86 195 86
Depreciation and amortization 70 61 138 121 274 264
Other 132 87 277 180 475 330
--------- --------- --------- --------- --------- ---------
1,056 840 2,149 1,645 4,222 3,270
--------- --------- --------- --------- --------- ---------
OPERATING INCOME 241 164 561 426 1,007 868
--------- --------- --------- --------- --------- ---------
Other income 8 7 7 7 97 62
--------- --------- --------- --------- --------- ---------
INCOME BEFORE INTEREST, INCOME TAXES AND
MINORITY INTEREST 249 171 568 433 1,104 930
Interest expense 92 61 180 123 334 247
Income taxes 58 40 140 114 200 251
Minority interest 0 0 1 0 15 0
--------- --------- --------- --------- --------- ---------
INCOME BEFORE EXTRAORDINARY ITEMS 99 70 247 196 555 432
Extraordinary items (net of taxes) 0 0 0 0 (46) 0
--------- --------- --------- --------- --------- ---------
INCOME BEFORE DIVIDENDS ON PREFERRED STOCK 99 70 247 196 509 432
Preferred stock dividend requirements 7 7 13 13 26 25
--------- --------- --------- --------- --------- ---------
NET INCOME $ 92 $ 63 $ 234 $ 183 $ 483 $ 407
========= ========= ========= ========= ========= =========
EARNINGS PER SHARE OF COMMON STOCK - BASIC AND DILUTED
Adjusted earnings $ 0.64 $ 0.40 $ 1.63 $ 1.16 $ 2.80 $ 2.12
One-time adjustments 0.00 0.00 0.00 0.00 0.51 0.42
--------- --------- --------- --------- --------- ---------
Actual earnings $ 0.64 $ 0.40 $ 1.63 $ 1.16 $ 3.31 $ 2.54
========= ========= ========= ========= ========= =========
AVERAGE NUMBER OF SHARES OUTSTANDING
(THOUSANDS) 144,137 157,694 143,948 157,653 145,985 160,347
</TABLE>
(a) Certain amounts have been reclassified to conform to the current year
presentation
KEY INDICATORS
FINANCIAL
12 MONTHS ENDED 12 MONTHS ENDED
JUNE 30, 2000 JUNE 30, 1999
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Dividends declared per share $1.03 $1.00
Book value per share(a) $12.31 $11.96
Market price per share(a) $21.9375 $30.7500
Dividend yield 4.7% 3.3%
Dividend payout ratio(b) 37% 47%
Price/earnings ratio(b) 7.8 14.5
Return on average common equity(b) 25.18% 12.61%
(a) End of period
(b) Based on adjusted earnings
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<TABLE>
<CAPTION>
OPERATING
PPL ELECTRIC UTILITIES CORP. 3 MONTHS ENDED JUNE 30 6 MONTHS ENDED JUNE 30 12 MONTHS ENDED JUNE 30
(CONSOLIDATED) ---------------------- ---------------------- -----------------------
PERCENT PERCENT PERCENT
2000 1999 CHANGE 2000 1999 CHANGE 2000 1999 CHANGE
---- ---- ------ ---- ---- ------ ---- ---- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
(millions of kwh)
Electricity delivered to
retail customers(a) 7,851 7,673 2.3% 17,303 16,866 2.6% 33,483 33,175 0.9%
Electricity supplied to
retail customers(a) 9,211 7,868 17.1% 19,046 16,754 13.7% 35,988 32,874 9.5%
Wholesale energy sales 7,184 7,308 -1.7% 16,723 16,261 2.8% 32,177 35,924 -10.4%
</TABLE>
(a) Electricity delivered to retail customers represents the kwh delivered to
customers within PPL Electric Utilities Corp.'s service territory. Electricity
supplied represents the kwh supplied to customers within and outside PPL
Electric Utilities Corp.'s service territory (including sales of PPL
EnergyPlus). Customers within PPL Electric Utilities Corp.'s service territory
will have their energy delivered by PPL Electric Utilities Corp.; however, they
have a choice as to their electricity supplier.
Certain statements contained in this news release, including
statements with respect to future earnings and generating capacity,
are "forward-looking statements" within the meaning of the federal
securities laws. Although PPL Corp. believes that the expectations and
assumptions reflected in these forward-looking statements are
reasonable, these statements involve a number of risks and
uncertainties, and actual results may differ materially from the
results discussed in the statements. The following are among the
important factors that could cause actual results to differ materially
from the forward-looking statements: market demand and prices for
energy, capacity and fuel; weather variations affecting customer
energy usage; competition in retail and wholesale power markets; the
effect of any business or industry restructuring; the profitability
and liquidity of PPL Corp. and its subsidiaries; new accounting
requirements or new interpretations or applications of existing
requirements; operating performance of plants and other facilities;
environmental conditions and requirements; system conditions and
operating costs; performance of new ventures; political, regulatory or
economic conditions in countries where PPL Corp. or its subsidiaries
conduct business; capital market conditions; foreign exchange rates;
and the commitments and liabilities of PPL Corp. and its subsidiaries.
Any such forward-looking statements should be considered in light of
such factors and in conjunction with PPL Corp.'s Form 10-K and other
reports on file with the Securities and Exchange Commission.
*EDITORS NOTE: VISIT OUR DEDICATED MEDIA WEB SITE AT WWW.PPLNEWSROOM.COM FOR
ADDITIONAL NEWS AND BACKGROUND ABOUT PPL.
